The price of property in Shenzhen, neighbouring Hong Kong, is rising in price faster than anywhere else in the world.
Photograph: Imaginechina/REX/Shutterstock

House prices in Shenzhen, the city which is a hub for technology hardware and known as China’s Silicon Valley, soared by almost 50% last year – the fastest growth in residential property prices worldwide.

House prices in the two biggest Greek cities – Thessaloniki and Athens – were both ranked among the worst six in the survey of 165 cities, falling 5.9% and 4.8% respectively. There were also significant drops in some Italian cities, including Rome, Trieste and Genoa. Nicosia and Larnaca in Cyprus were also among the worst performers.

The Global Residential Cities Index showed that house prices in cities worldwide went up 4.4%. Behind Shenzhen, Auckland was the second fastest growing market with rises of 25.4%, followed by Istanbul (25%) and Sydney (19.9%).

Shenzhen has become a hub for the production of hardware used in electronics and has a permanent population of 10 million, rising to 15 million in the summer – autumn electronics season. Their average age is 30.

The city bordering Hong Kong did not exist 30 years ago, sporting just a few fishing villages. In 1979, it was declared China’s first special economic zone and surrounded by an 85-mile long, barbed wire fence. Investment and migrant workers flooded the area and factories and housing were built from scratch. By the mid-90s, the population had climbed to 3 million. In 2004, the first metro station opened and a decade later the network had grown to 131 stations.

Two Turkish cities featured in the top 10 – Istanbul and Izmir – while Budapest recorded the biggest rise among European Union cities, with prices up 16.3%. Budapest is also the strongest performing capital city in the index, with demand fuelled by an investment immigration bond for Chinese nationals.

Cities traditionally associated with high prices failed to feature prominently. London was ranked at 16 (11.4% growth) with New York at 89th (3.3%). The fast rising prices of Sydney, the fourth fastest rising market, has resulted in high rents and the same sort of concerns about the effects on the young population in the city as in London.

In the US, Portland in Oregon and San Francisco were the highest risers, both with increases over the year of 10%. The fastest growing North American city was Vancouver, with prices up nearly 12% on an annual basis.

The legislative assembly in Chandigarh, where property prices hit the bottom of the league table for house price performance. Photograph: John Macdougall/AFP

After London, Glasgow was the highest rising city in the UK, with prices up 8.6% according to the survey.

At the bottom of the league table, with the fastest falling prices, was the Indian city of Chandigarh, the capital of the north Indian states of Punjab and Haryana, which has a population of 1 million and has been rated as India’s wealthiest city. However, house prices in the city declined by 7.7% last year. The Reserve Bank of India cut interest rates four times last year, but the base rate still stands at 6.75% and the economy has faltered.

Knight Frank said the long-term outlook for house prices in cities was of further upward price pressure. The report said: “Urban and rural housing markets are increasingly polarised when it comes to price performance. According to the World Bank, 54% of the world’s population currently lives in cities, and by 2045 the urban population will rise by another 2 billion to 6 billion, suggesting the pressure on urban prices looks set to intensify.”